International Trade Minister Nigel Huddleston has today kicked off a multi-state visit to Peru and Colombia to meet counterparts and push forward action to resolve trade barriers.
The Minister will also announce new measures to ease regulation for British pharmaceutical companies in Colombia.
Cutting red tape for some of the UK’s most innovative companies will unlock a multi-million-pound market while additionally helping the country access essential products such as medicines and medical devices.
The visits come as new figures show the UK has resolved around £1.3 billion worth of trade barriers that have been preventing UK businesses from exporting their goods and services to the Latin America and the Caribbean region in the last financial year.
The region represents 8% of the global population and its economy was estimated at £4.7 trillion in 2022. It is projected to rise to over £8 trillion in 2035, contributing to 5.2% of global GDP. It poses an exciting opportunity for UK businesses to build on our £40 billion trading relationship as its economies continue to open up and grow.
Speaking ahead of the visit, International Trade Minister Nigel Huddleston said:
Latin America presents incredible opportunities for British businesses, and we aim to put them at the front of the queue by making it easier to sell and establish a presence in countries like Colombia and Peru.
Through our trade dialogues, CPTPP membership and unlocking even more trade barriers, we are creating fresh possibilities for UK companies to export their top-notch goods and services around the world.
Minister Huddleston is expected to use his visit to advance discussions on trade barriers across a range of sectors, including:
- Increased flexibility for the emerging green hydrogen market in Colombia, allowing world-leading UK hydrogen companies to be at the forefront of hydrogen deployment in Colombia.
- Stopping companies from being taxed twice via a Double Taxation Agreement, improving conditions for UK businesses and increasing Peru’s investment potential, with a potential worth of around £55 million
- Exploring options to remove Peru’s discriminatory tax treatment of imported spirits, such as Scotch Whisky, compared to locally produced ones, potentially worth around £55 million.
The Minister will also meet with potential investors and private sector representatives in Peru to explore new investment and trade opportunities that have opened since the UK signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) this summer.
Earlier this year, Business and Trade Secretary Kemi Badenoch made the removal of trade barriers one of her top priorities, aiming to resolve 100 priority trade barriers around the world and unlock export opportunities worth around £20 billion for UK businesses.
Removing trade barriers is a proven catalyst for increased exports economic growth and more jobs and being an independent trading nation has given us greater autonomy to tackle barriers facing UK businesses.
Scotch Whisky Association International Director Ian McKendrick said:
The SWA works around the world to ensure the Scotch Whisky industry can compete on a level playing field with other alcoholic products. We value the work of the Department of Business and Trade to fight tax discrimination, and the support the Minister is giving to our efforts in Peru.
Scotch Whisky has faced tax discrimination in Peru versus domestically produced spirits for almost two decades, in contravention of WTO rules. This discrimination creates the conditions for counterfeit alcohol and smuggling in a black market which costs the Peruvian government more than $70m annually. Addressing this is a priority for the Scotch Whisky industry, where Peru and other South American markets have the potential to further increase the industry’s global export footprint.
Through Britain’s UK-Andean free trade agreements and now through our CPTPP membership, the UK are seeking to unblock even more trade barriers and create fresh possibilities for UK companies to export their top-notch goods and services around the world. UK-Peru bilateral trade was recorded at £3.4 billion in 2022 in current prices and UK-Colombia bilateral trade was recorded at £1.8 billion in 2022 in current prices.
New DBT figures show the UK has resolved around £1.3 billion worth of trade barriers in LATAC in the last financial year. A subset of 24 out of 34 resolved barriers identified in DBT’s annual report and accounts have undergone a valuation assessment, of which the aggregated value is estimated to be around £1.3 billion. The remaining 10 barriers have not undergone a valuation assessment.
The data on resolved barriers are extracted from the Digital Market Access Service (DMAS). It is the internal government database of trade barriers facing UK businesses that enables closer collaboration across government in Whitehall and at overseas Posts to analyse and progress action to try and resolve them where feasible. For further information on DMAS, find online: New service to open overseas markets for UK businesses – GOV.UK (www.gov.uk)
DMAS is not a comprehensive repository of all market access issues facing UK exporters, and reporting rates vary widely across countries and regions. As such, aggregate figures should be interpreted as an indicative estimate based on a selective sample.
Aggregate figures on the valuation of resolved barriers are based on DBT analysis of specific market access barriers using the methodologies set out in the DBT statistical publication. To calculate the aggregate figures, the mid-point for each valuation range is added to provide a central estimate. Further details on the methodology for the aggregate valuation figures are published in a DBT analytical working paper.
GDP data is in current prices sourced from the IMF World Economic Outlook and converted from US dollars to UK pounds using the Bank of England average spot exchange rate for 2022.